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The Governance of Global Competition: Challenges for the Second Decade of the ICN

The Governance of Global Competition: Challenges for the Second Decade of the ICN. Prof. Dr. Oliver Budzinski Professor of Competition and Sports Economics University of Southern Denmark, Campus Esbjerg Department of Environmental and Business Economics Markets & Competition Unit

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The Governance of Global Competition: Challenges for the Second Decade of the ICN

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  1. The Governance of Global Competition: Challenges for the Second Decade of the ICN • Prof. Dr. Oliver Budzinski • Professor of Competition and Sports Economics • University of Southern Denmark, Campus Esbjerg • Department of Environmental and Business Economics • Markets & Competition Unit • Niels Bohrs Vej 9-10; DK 6700 Esbjerg • Email: obu@sam.sdu.dk

  2. Structure • What are the Problems Caused by Cross-border Competition? • How Did the ICN Perform so far? • What Remains to Be Done? • Is the ICN up to the Job?

  3. 1. What are the Problems Caused by Cross-border Competition? • International Externalities of ‘National’ Competition Policies (strategic competition policy; inbound-focused policy goals (protection of competition in domestic markets; ‘national’ (consumer) welfare); jurisdictional conflicts) • Deficiencies of Multiple Procedures (administrative costs  taxpayer; transaction costs  market participants) • Lack of Protection of Competition (small and/or powerless jurisdictions; developing countries) •  Reduction of World Welfare!

  4. 2. How Did the ICN Perform so far? • since October 2001 • 107 members (competition agencies) from more than 90 countries • Principles: Best Practice Recommendations & Peer Pressure • impressive output of more than 10 000 pages of virtual paper + capacity building and promotion of the implementation of competition regimes in developing and transitory countries + compilation of current practices in member jurisdictions (merger review incl. substantive assessment and prohibition standards; anti-cartel enforcement techniques; unilateral conduct [highlighting the differences]; competition advocacy) + handbooks and manuals (materials for training of agency staff) + best practice recommendations about procedural rules in merger control (notification rules and review procedures) + empirical analyses (Rowley & Campbell 2005; Evenett & Hijzen 2006; ICN 2010): best practice recommendations influence competition regime reforms and implementation processes in member jurisdictions!

  5. 2. How Did the ICN Perform so far? • barely any best practice recommendations on substantive issues • consequently: no substantial convergence (substantive rules, standards, competitive effects and assessment practices and policies, etc.) • to some extent reliance on and promotion of controversial practices (case-by-case effects approach in merger control;  ‘deficient’ harmonization) • no change of the inbound focus of competition policy; no implementation of a truly international goal • (marginal) decrease of the costs of multijurisdictional merger review due to imperfect convergence of procedures - but nowhere near a one-stop shop • sustainability of ‘spirit of cooperation’? • no direct case-related cooperation; however, indirect facilitation of case-related cooperation • effective competition advocacy in times of crisis?

  6. 3. What Remains to Be Done? • International Externalities of ‘National’ Competition Policies (strategic competition policy; inbound-focused policy goals (protection of competition in domestic markets; ‘national’ (consumer) welfare); jurisdictional conflicts) • Deficiencies of Multiple Procedures (administrative costs  taxpayer; transaction costs  market participants) • Lack of Protection of Competition (small and/or powerless jurisdictions; developing countries)

  7. 4. Is the ICN up to the Job? • What the ICN Can Be Expected to Achieve: • proceeding in creating a common competition culture and a ‘spirit of cooperation’ • effective best practice recommendations on procedural and organizational aspects • competition advocacy • What the ICN Cannot Be Expected to Achieve: • one-stop shop for multijurisdictional competition cases • ‘hard’ convergence • coherent international competition regime • closing the enforcement gaps • Conclusion: • The achievable benefits have been reaped, now it is time to move on • international competition rules and enforcement • lead jurisdiction models

  8. The Governance of Global Competition: Challenges for the Second Decade of the ICN • Prof. Dr. Oliver Budzinski • Professor of Competition and Sports Economics • University of Southern Denmark, Campus Esbjerg • Department of Environmental and Business Economics • Markets & Competition Unit • Niels Bohrs Vej 9-10; DK 6700 Esbjerg • Email: obu@sam.sdu.dk

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